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To calculate your calculate your lifetime value for an offering to which you have developed loyalty. In your calculation, consider the average amount you purchase (AMP) annually and the likelihood of you being retained as a customer next year (assume this retention rate remains the same each succeeding year). Also, assume:
- Your acquisition cost is $100
- Your average annual customer cost is 60% of your revenue
- The discount rate is .05.
In addition to your calculation, be sure to identify the product/service you chose and provide a brief explanation of how you came up with your calculation. Next, identify and describe two recent factors (one internal and one external to the company) that might positively effect your CLV and then do the same thing for two recent factors that might have a negative impact. Recalculate your CLV considering the positive factors and then separately for the negative factors. Lastly, briefly summarize your CLV analysis with some suggestions for the company.
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